Just in time is the best inventory management system. With just in time, the organization doesn't house inventory which saves them money.
The GAAP method for obsolete or slow moving inventory is to account for all inventory using either market value or cost method. The method which results in the lower amount is the one that is used.
Inventory methods include first in-first out, or other logical method. In this case, however, diamond traders probably keep inventory records and execute trades in methods that are the most profitable at the time of the trade.
adjusted selling price method , retail price of the inventory is calculated and marjinal profit is deducted from it generally used in retail business also known as Retail inventory method
which type of inventory method used in top ten company?
There are different inventory costing methods an accountant can use for cost o goods sold accounting. The methods include last in, first out, average cost method, first in, first out, and specific identification method.
perpetual
Periodic
periodic inventory system
during inflation the best method to use inventory valuation that produces that produces that least amount of profit is
Weighted average inventory valuation method is method in which inventory purchased at any price is put together to calculate one price for allocation in contrast to FIFO or LIFO.
The GAAP method for obsolete or slow moving inventory is to account for all inventory using either market value or cost method. The method which results in the lower amount is the one that is used.
FIFO method is based on the actual cost of each particular unit of inventory. In this method, inventory which is purchased first is sold out first. It ensures that old inventory is not piled up in storage and most companies use this method to evaluate their inventory.
FIFO method where the older items are sold first.
Periodic inventory method calculate ending stock at the end of the accounting period, which could be Month to Date or Year to Date, while Perpetual inventory system calculates the ending stock on a continuous basis after each transaction (Purchase or Sell). Within Retail industry, periodic inventory method used for inventory valuation at the stores, whereas distributer like SuperValu (in US) follows perpetual inventory method to track inventory in their distribution centers. As a best practice, some of the retail companies are using perpetual accounting method to track inventory available in warehourses and distribution centers. In an idealistic world, perpetual inventory method can provide the true and real time inventory information, however due to complexities in consolidating all the purchases, sales, shrinkages and other market factors, it is advisable for retail companies to follow periodic accounting method to analyze and review the results before presenting the inventory valuation results to internal and external agencies like Shareholders, Income Tax Authorities, et el.
The inventory costing method that reflects the cost flow in the reverse order and will report the earliest costs in ending inventory is last in first out. This makes use of a perpetual inventory system.
FIFO
Following are inventory valuation methods: 1 - Lifo (Last in first out) 2 - Fifo (First in first out) 3 - Average method.